State the term:
A business entity owned by one person who is legally responsible for the debt and taxes of the business.
sole proprietorship
100
This is the account where the property is owned by a business.
Asset
100
The costs of Running a Business
- Revenue
100
A business that operates as separate from its owners.
Corporation.
100
When does an accountant do a correcting entry?
When an error in a journal is discovered after posting.
200
State the term:
A Business owned by two or more people. Each person is often liable for debts of the business.
Partnership
200
The basic accounting equation is..?
Assets= Liabilities + Owner's Equity.
200
The book of original entry
General Ledger
200
-What is a net income?
the amount of revenue that remains after expenses for the period are subtracted
200
What is the Normal Balance of a liability account?
Credit
300
When total expenses are greater than total revenue
Net loss
300
What is the most liquid asset a company can own?
Cash.
300
What is the source document?
The paper that is prepared as evidence of a transaction after such transaction occurs.
300
List 3 examples of source documents commonly used.
-Invoice -Receipt -Memorandum -Check Stub
300
The financial statement that reports the revenues and expenses for a period of time such as a year or a month is the
Income Statement
400
The acronym for the common rules and standards that companies must follow when preparing its external financial statements is
- GAAP
400
When revenue is greater than expenses, you have a ___?
Net Income
400
The name given to any exchange or event that has a direct economic effect on the assets, liabilities, or stockholders’ equity of a business.
- Transaction
400
The process of transferring the information in a journal entry to an individual account .
Posting
400
financial statement that shows the results of the operating activities of a firm for a specific period of time.
Income Statement
500
A periodic report prepared by a business to test the equality of total debits and total credits in a ledger.
-Trial Balance
500
What is the difference between income and profit?
Income relates to revenue, while profit is the positive number you get from subtracting your expenses from your income.
500
What is the difference between a calendar year and a fiscal year?
Calendar year- If the accounting period of a business begins on January 1 and ends on December 31st.
Fiscal Year- An accounting period of 12 months.
500
What is used to indicate the profit of the period?
Net income
500
The accounting assumption that states that businesses should be treated as if they will continue to operate indefinitely or at least long enough to accomplish their objectives.